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 accordingly passed through Legislative Council (March 30, 1870) a Bill giving the Governor power to make such regulations with regard to emigration as he may think proper under instructions from the Colonial Office. Sir Richard stated on this occasion that he personally deprecated the entire abolition of contract emigration to foreign countries which under existing instructions he would be obliged to effect, but that his instructions were peremptory. Later on, difficulties were made by the Colonial Secretary (in the absence of Sir Richard) even as to shipping coolies by the Pacific mail steamers, as it was stated (October 15, 1871) that the Colonial Office instructions prohibited emigration, whether under actual or merely implied contract, to any non-British country. The U.S. Minister, the Hon. W. H. Seward, passing through Hongkong in January, 1871, held a reception at the U.S. Consulate, when he gave it as his opinion that Chinese emigration to the United States is desirable as tending to the advancement of western civilization in China, and that by this means enterprises, such as railways and mining operations, will be introduced into China, and excessive emigration to America stopped, so soon as the Chinese labourers will be able to find in their own country that employment which now induces them to go abroad. Mr. Seward's influence caused emigration from Hongkong to California to expand considerably during the next few years.

The Chinese commerce of Hongkong rapidly expanded at the beginning (1865 to 1868) of this period at the expense of the Canton trade which then laboured under illegal exactions, made by the Mandarins and their favoured monopolists, which caused even the manufacture of vermilion and the clarifying of ginseng to be removed from Canton to Hongkong. Even in the piece goods trade, a very large business was now done in Hongkong, particularly in cotton fabrics, the goods being sent into the interior of the Canton Province without passing through or near Canton, and at Canton itself the import of piece goods fell entirely into the hands of Chinese who came down to Hongkong to buy. The rice trade also was driven